Annual Windows upgrades demand consumer-business split, say analysts

Microsoft will speed up the release cadence of Windows, starting in 2013, to issue annual OS upgrades, according to reports on the Web today.

But analysts believe that the new pace will be both difficult for Microsoft to achieve, and more importantly, will be rejected by its biggest customers unless the company takes the even more drastic step of splitting Windows in two.

As reported by The Verge on Wednesday, Microsoft will ship an upgrade to Windows 8, currently code-named "Windows Blue," in mid-2013. The upgrade, analogous to what Microsoft has called "service packs" in the past, will not only refresh Windows 8 but inaugurate an annual schedule.

Citing "several sources familiar with Microsoft's plans," The Verge also claimed that next year's upgrade will be either low-cost or free to get as many customers as possible onto the new build, which will continue to use the Windows 8 branding.

Service packs, which have rarely offered new features, have always been free to current Windows users.

But while analysts generally applauded the concept of faster Windows upgrades, they were dubious about Microsoft's ability to pull off an accelerated schedule or get all customers to buy into the idea.

"I do think Microsoft will pick up the pace," said Michael Silver of Gartner in previously-unpublished comments made during an interview last month. "But any time Microsoft picks up the pace, it causes an issue with enterprises."

Consumers may want more frequent operating system upgrades -- Apple's customers did not revolt in massive numbers when the Cupertino, Calif. company shifted to an annual schedule this year with the release of OS X Mountain Lion -- businesses do not. They prefer long release cycles, to give them time to digest each upgrade, test it before deploying to company-controlled PCs, and ideally, refresh their hardware, something that happens, at best, every three to five years.

The solution? Split Windows into two discrete versions -- one for consumers, the other for businesses -- something that's not been done for more than a decade.

"What Microsoft needs to do is to move to different cycles for consumer versus enterprise, since a faster pace has mostly consumer repercussions," said Silver.

"I think Microsoft would attempt to limit this [accelerated schedule] by disconnecting the cadence," Moorhead said in an interview today. "They'll provide faster upgrades for consumers, and treat upgrades for enterprises as they do today."

Taking that tack, added Moorhead, would give Microsoft a better shot at competing with Apple in the consumer personal computer market. "I think it would be a great idea, because technically speaking Microsoft has lost the edge in desktops. Apple has been rolling out new features over five years ahead of Microsoft."

But Moorhead was more skeptical than Silver that Microsoft could triple the speed of Windows upgrades, at least initially.

"I doubt that they can pull it off at first. Microsoft is a commercial company, not a consumer company," Moorhead said, noting that too many of Microsoft's all-consumer projects have foundered. "I have my doubts based on that history and the commercial history of the company," he added.

But launching an upgrade to Windows 8 in mid-2013 would, Moorhead argued, solve at least one problem for Microsoft's consumer strategy.

"By launching [Windows upgrades] around the holidays, they miss back-to-school, which makes no sense," said Moorhead of the year's other major sales season. "They need to wrap it up in the June time frame to get product in the channel by August."

That, too, would find Microsoft following rival Apple, which has shipped its last two OS X upgrades in July, and the last three in either July or August.

The last time Microsoft relied on two markedly different editions of Windows -- one for consumers, another for businesses -- was in 2000, when it launched the oft-derided Windows Millennium for consumers and Windows 2000 for enterprises. With Windows XP, Microsoft merged those lines into one Windows client for all customers.

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